In a coordinated effort, the UK's Financial Conduct Authority (FCA) has launched a crackdown on unauthorized peer-to-peer cryptocurrency trading platforms, targeting eight locations in London. The operation, carried out in collaboration with HMRC and the South West Regional Organised Crime Unit, resulted in the issuance of cease-and-desist notices and the collection of evidence for ongoing criminal investigations.
The FCA alleged that these platforms facilitated P2P crypto trading without proper registration or anti-money laundering controls, which is a requirement under UK law. Currently, there are no registered P2P crypto traders or platforms in the country. According to Steve Smart, the FCA's executive director of enforcement and market oversight, unregistered P2P crypto traders operating in the UK are acting illegally and pose a significant financial crime risk. Law enforcement agencies view this operation as part of a broader effort to disrupt the movement of illicit funds.
The action is consistent with previous enforcement measures, including the prosecution of operators of illegal crypto ATMs and the arrest of individuals linked to unregistered crypto exchanges. Last year, the FCA also took action against an offshore platform for unlawful financial promotions and expanded its oversight of social media figures promoting high-risk crypto products. As the UK prepares to introduce a more comprehensive regulatory regime for crypto by October 2027, the FCA is urging consumers to verify the registration status of firms using its online register and warning them of the risks associated with dealing with unregistered P2P traders, including the lack of access to the Financial Ombudsman Service or compensation schemes.